The EastAfrican BUSINESS SEPTEMBER 20-26,2014 LIFE ASSURANCE BUSINESS Tanapa and village≥s fight ove≥ pa≥k fees By ADAM IHUCHA Special Correspondent TANZANIA NATIONAL Parks and residents of northern Tanzania are involved in a tussle over a road that passes through Arusha National Park. Tanapa has imposed fees on vehicles travelling through Momella road that crosses through the park. From July 2014, Tanapa Uganda IRA officials at the 2014 NSSF customer week in Kampala. Picture: File Ugandan insurers banking on liberalisation of pension sector Companies hope pa≥liament passes the pension libe≥alisation Bill that has been pending fo≥ fou≥ yea≥s By DICTA ASIIMWE Special Correspondent U gandan insurance firms that separated their com- posite companies are banking on the liberalisation of the pension sector to increase their portfolios. Last year, the Insurance Regulatory Authority (IRA) announced that effective September 2, companies would be required to demerge and operate separately. Mariam Nalunkuma, the spokesperson for IRA, said four of the six companies that had been operating as composites have since separated. Those that have demerged are Jubilee Insurance Company, ICEA, UAP and Goldstar. The National Insurance Company missed the deadline and is to be assessed by IRA next week. The companies that de- merged are now hoping that parliament passes of the pension liberalisation Bill, which has been pending for almost four years. Justus Mutiga, the group chief executive officer of the Insurance Company of East Africa (ICEA), said insurers will be looking forward to the opening up of the pension sector as this would be a source of business for life assurance. The Bill states that with liberalisation of the pension sector, NSSF keeps 5 per cent of the total savings and the insurance market competes for the remaining 10 per cent; the current law mandates NSSF to collect 15 per cent of the statutory pension savings. The delay in passing the law is because workers’ representatives in parliament have been opposed to the redistribution of pension money. In Kenya, companies and their employees are required to remit Ksh400 ($4.5) as compulsory statutory retirement savings. “After contributing 15 per cent to NSSF, it is difficult for employers to get extra money to pay into a private pension scheme,” Mr Mutiga said. Officials at Britam predict that the process of liberalising pension will take between three and five years. Due to the delay, the company will drop its life assurance segment from next year saying the requirements that have been set are too high and yet the market is too small to be profitable in the next 10 years. Britam CEO Allan Mafabi said from next year the com- “After contributing 15 per cent to NSSF, it is difficult for employers to get extra money.” Justus Mutiga, group chief executive officer ICEA pany pass on its seven clients, that include five financial institutions, two non-governmental organisation and an oil company, to other insurers. After liberalisation, the company will consider re-entry to the market. He said the segment has written an average of 10 per cent of the total premiums in Uganda. “And that is 10 per cent in a market that collected just Ush463 billion ($175 million) in premiums last year,” he said. But Ms Nalunkuma said the life assurance sector has been growing and will become profitable even without pension liberalisation. REQUIREMENTS IRA expects all insurance companies to increase the minimum capital requirement from Ush1 billion ($378,000) for each segment to Ush3 billion ($1.1 million) for life assurance, and up to Ush4 billion ($1.5 million) for general insurance. The deadline for increasing minimum capital is October 2014, although it has already been enforced for companies seeking licenses to separate their composite companies. started to charge Tsh5,000 ($3) for a one-way permit for each citizen in a private car, Tsh2,000 ($1.25) for those using public transport, and Tsh20,000 ($12.5) for a bus. Although Tanapa has justified collecting the fees as it seeks to raise funds for road maintenance and conservation, locals are questioning the timing. Arusha National Park is in the middle of Arumeru district, separating the north and south. On Thursday, locals in Songoro ward in northern Meru threatened to disrupt tourism activities to press the government to allow them to pass through the park free of charge. “They are furious, they want to go to the Arusha National Park main gate and turn the area into a ‘no go zone’ for tourists,” said Efata Nnko, a civic leader for Songoro ward. For over five decades, the road has been used by northerners to access administrative services at the Arumeru district headquarters, medical care and markets for their products, all located in the south. Locals say the fee is too high for them. “If you have 10 family members and want to take part in a funeral in the southern part of our district, you have to pay Tsh20,000 ($12.5) for one way transit permit, apart from the fare,” said John Mbise. East Meru MP Joshua Nassari said the fee will affect patients and pastoralists. “Leaders have been working hard to calm down furious villagers who want to block the Ngongongare gate, the main entrance for tourists to Arusha national park, to protest the fee,” the MP said. Legal fee Tanapa spokesperson Pascal Shelutete said the fee is legal. “Not all villagers are subjected to this fee. For example, residents from Ngarenanyuki and Kilinga wards in the northern part of Arusha National Park, comprising nearly 14 villages, are exempted because they have no alternative route to the south,” he said. Mr Shelutete said the fee is not only charged at Arusha National Park, but applies to all roads passing through national parks across the country, save for Mikumi road, which is under Tanzania Roads. In a letter dated August 7 to the Arumeru District Commissioner, Arusha national park chief park warden Bettie Looibok said there are two alternative roads outside the park — King’ori-Ngarenanyuki road and OldonyosambuNgarenanyuki road through Mukuru. But locals say the two roads are too far and add unnecessary costs. REQUEST FOR PROPOSALS for Graduating Civil Society from CEPF Support in the Albertine Rift and the Eastern Arc Mountains Closing Date: 5th October 2014 The Critical Ecosystem Partnership Fund (CEPF) is a joint initiative of l’Agence Française de Développment, Conservation International, the European Union, the Global Environment Facility, the Government of Japan, the John D. and Catherine T. MacArthur Foundation, and the World Bank. It is a global program that provides grants to nongovernmental organizations and other private sector partners to protect critical ecosystems. A fundamental goal of the Fund is to engage civil society in efforts to conserve biodiversity. CEPF has an active grants portfolio in the Eastern Afromontane region. CEPF seeks to prepare a long-term strategic vision to establish the end point for investment in the Albertine Rift and Eastern Arc Mountains. This includes parts of South Sudan, Uganda, Rwanda, Burundi, the Democratic Republic of the Congo, Kenya, and Tanzania. CEPF seeks a consultant or team to develop this vision. The maximum value of this engagement will be $50,000. The period of work will be November 2014 – April 2015. Interested parties may view the full request for proposals at cepf.net/RFP-EasternArc Consultant to Prepare Long-Term Strategic Vision 45